of ComfortDelGro fare hike, a suspected cartel & "Is the President of NTA the same person with the President of Comfort Taxi Operators' Association?!"

Conrad Raj has spoken...and rightly so when he suggested the Competition Commission to "take a look at the call by the National Taxi Association (NTA) for other cab companies to follow Comfort's move, which sounds suspiciously like a cartel at work".

So what is a cartel?

From Wikipedia:

A cartel is a formal (explicit) agreement among competing firms. It is a formal organization of producers and manufacturers that agree to fix prices, marketing, and production.

Cartels usually occur in an oligopolistic industry, where there is a small number of sellers and usually involve homogeneous products. Cartel members may agree on such matters as price fixing, total industry output, market shares, allocation of customers, allocation of territories, bid rigging, establishment of common sales agencies, and the division of profits or combination of these.

The aim of such collusion (also called the cartel agreement) is to increase individual members' profits by reducing competition.

I leave to you, dear Readers whether or not to agree with Conrad Raj's suggestion above.

For me, I've decided to dump my ComfotDelGro shares (yes, I do have a conscience!), vowed not to call this company's hotline if I ever have a need to book a taxi.

Oh, and I also decided to google for 'Wee Boon Kim'--his name is frequently mentioned in the articles below, and 'credited' to be the one who as the President of NTA which subsequently urged the five other taxi operators in Singapore to follow ComfortDelGro's fare revision.

And I came across this article from Business Times, "ComfortDelGro revises taxi fare structure" in which Wee Boon Kim is mentioned to be "president of the Comfort Taxi Operators' Association".

Is it just a coincidence that the name of the President of NTA is the same with that of the president of the Comfort Taxi Operators' Association?!

Or is it the same person?

A little surprise then that NTA urged other taxi operators to follow the highly unpopular move by ComfortDelGro...

If the latest round of price hikes by transport provider ComfortDelGro brings about a better cab service, there will be little reason to complain. Unfortunately I believe that will not be the case and the level of service will be, at best, no better.

At the current level of fares and surcharges, many taxi drivers are picking and choosing their passengers. Logic says that if they can get more money for the same job, they are going to work less hard, not strive for better service.

In any other place there would be such a hue and cry over the move by Comfort. As it is, cab rides here are not all that cheap - often more expensive than in Hong Kong. The flagdown here is significantly higher; in Hong Kong it is HK$18 (less than S$3) for the first two kilometres to our 1km.

Oh yes, Comfort will reduce the peak hour charges from 35 per cent of the metered fare to 25 per cent, and the holiday surcharge of S$1 will go. Some booking charges will be reduced slightly.

But the overall effect will be commuters having to pay more for their trips from next week. The flagdown will cost at least 20 cents more, while the peaks hours will be extended and the evening peak-period will be applied to Sundays and public holidays too.

Comfort is doing the revision, which comes into effect next week, on the basis that "strong" population growth and an increase in tourists have led to a substantial rise in demand.

So with more commuters in the market, wouldn't taxi drivers be earning more from the increased volume of demand for their service? Or is Comfort perversely attempting to dampen demand by making taxi rides unpalatable?

On one hand the Government discourages people from owning cars - but at the same time, public transport is costing us more because of the resulting greater demand. Does this not seem weird?

National Taxi Association (NTA) president Wee Boon Kim was quoted as saying: "It has been more than four years (since the last fare adjustment) and like most Singaporeans, our drivers too look forward to annual improvements in their take-home income so as to provide a better life for their families."

I am all for a better life for all here. But the very fact that cabbies pick and choose their passengers is an indication that the present fare structure is more than adequate.

Our cab drivers appear not hungry enough, unlike in Hong Kong where most taxi drivers own their vehicles and have to bid huge amounts for their licences. This is because our cab drivers are mollycoddled with all kinds of surcharges.

Just last Monday, I waited for 45 minutes along North Bridge Road near Arab Street to get a cab. I finally decided to take a bus to my destination in Somerset Road - not because there were no empty taxis but because they refused to stop for me or others trying to hail one.

In fact, more than two dozen cabs passed by with their green or blue lights on.

And to add to my angst, the same thing happened on the same night on Penang Road, with scores of frustrated commuters left flailing their arms in vain.

Did Comfort consider reducing taxi rentals to put more money in the pockets of its drivers? It can well afford to do so as it reported recently that revenue for the third quarter to end-September from its local business rose S$11 million to S$191.7 million, thanks to the larger operating fleet and higher cashless transactions. Operating profit was S$1.4 million higher at S$23.3 million.

Perhaps the Competition Commission should take a look at the call by the NTA for other cab companies to follow Comfort's move, which sounds suspiciously like a cartel at work.

Comfort, with its 15,700 taxis here, should be looking to giving the commuter a comfortable ride, not discomfort with price hikes. Or is this a prelude to a hike in taxi rentals?

From Today, "Higher fares, but no better service?".

The very people who are expected to benefit from the latest taxi fare revision - announced by transport operator ComfortDelGro on Monday - are apprehensive about the move.

All six ComfortDelGro taxi drivers this reporter interviewed said they were worried about a potential backlash from commuters. They made reference to the previous revision in December 2007 - also during the festive period - when the number of passengers dropped after the fare increases were announced. A reduction in taxi rental fees or concessions for diesel would be a better long-term solution to increase their earnings, they added.

"People may now think twice before taking cabs," said a taxi driver who wished to be known only as Mr Han. Another taxi driver, Mr Fadal, reiterated that he would have preferred the fares to remain unchanged.

ComfortDelGro last adjusted taxi rentals in 2000. It had said that it currently has no plans to increase rental and it will continue to subsidise its taxi drivers' diesel costs.

It said yesterday that it did not impose a diesel surcharge - and adjusted its fare structure holistically - as "overall costs have gone up and not just rising fuel costs".

On Monday, the National Taxi Association (NTA) backed ComfortDelGro's fare revision and urged the other operators to adjust their taxi fares as soon as possible.

Yesterday, in response to Today's queries, the Competition Commission of Singapore (CCS) reiterated that "trade or industry associations should not become the vehicle to facilitate price collusion or price-fixing".

Adding that it does not comment on individual cases, the CCS nevertheless said it "advises businesses and associations to familiarise themselves with the Competition Act which sets out the types of behaviour that are prohibited because they are considered to be anti-competitive".

Consumer Association of Singapore (CASE) executive director Seah Seng Choon stressed that price adjustments should be left to the individual operators.

He added that CASE is concerned about ComfortDelGro lengthening the peak period - which is subjected to a surcharge - on Mondays to Fridays from between 5pm and 8pm, to between 6pm and midnight. Noting that many workers head home before 6pm, Mr Seah said: "Considering there was the problem with getting cabs before midnight because of surcharges, we hope ComfortDelGro will put into place measures to address this."

According to the Land Transport Authority (LTA), there are 26,970 taxis in Singapore as at October and ComfortDelGro currently operates 15,700 of them.

Mr Johnny Harjantho, managing director of Smart Cab, which owns some 720 taxis, said the company would most likely align its hours of surcharges with those of ComfortDelGro "to make it less confusing" for commuters.

He would, however, consult the 1,000 drivers in his company over the next few days on whether to follow suit in revising its basic fares. "If the wrong decision is made, it may affect drivers and their livelihood," he said.

From Today, "ComfortDelGro fare revision: Cabbies worry about backlash".

Four out of five taxi operators are set to revise their fares after indicating that they are considering a fare change, The Straits Times reported on Wednesday.

These firms are Trans-Cab, SMRT, Premier and Smart. The move follows ComfortDelGro's announced fare revision next Monday.

Fares for most commuters will increase as a result of the changes, which will the peak-hour period and city-area surcharge, among other things.

The report said the fith company, Prime, is letting its drivers decide on whether to revise fares.

Most taxi operators are likely to modify their fares but they will seek their drivers' feedback first, the report said. A decision will be made in the next two weeks, the firms individually told the paper.

As for the fare revision. taxi operators have explained that as drivers' operating costs have risen since the last fare revamp in 2007, drivers need to have a higher level of income.

In a separate Straits Times report, cabbies from ComfortDelGro said the new fare structure will help them earn a little more each month.

But the drivers are also preparing themselves for a rental increase by their operator and for being shunned by some commuters who, for the moment, may not take taxis to protest agains the higher fares.

From Asiaone, "Four out of five taxi firms set to revise fares".

TAXI fares for many commuters are likely to go up from Monday after Singapore's largest taxi operator, ComfortDelGro, revises its fare structure.

The company said yesterday in a statement that its new fare structure will include reductions in the peak-hour surcharge. For example, the $1 public-holiday surcharge will be removed.

But, at the same time, peak periods will be extended, and will also include those during weekends and public holidays. For example, the evening city- area surcharge will be applied on Sundays and public holidays.

The last taxi-fare adjustment was done in December 2007.

"Since then, taxi drivers have had to cope with higher costs of living as a result of inflation," said the statement.

ComfortDelGro said the introduction of SMS and smartphone taxi-booking services in the past three years had greatly increased taxi-booking demand.

ComfortDelGro now handles 2.4 million bookings a month, up 47 per cent from 2007.

To cater for the high booking demand, the peak period will start at 6am and end at 9.30am on weekdays.

Current call-booking charges will be reduced by 20 cents - from $3.50 to $3.30 - during the peak period and from $2.50 to $2.30 at all other times.

ComfortDelGro's taxi companies, Comfort Transportation and CityCab, manage a fleet of about 15,700 taxis.

From Asiaone, "ComfortDelGro to revise cab fares".

The National Taxi Association (NTA) has urged the five other taxi operators in Singapore -- Trans-Cab, SMRT, Premier, Smart and Prime, to follow ComfortDelGro's fare revision, The Straits Times said on Tuesday.

The NTA represents taxi drivers here and currently has more than 11,000 members.

It said this would help to defray rising costs of operation, for example, higher diesel prices, and increase the annual income of taxi drivers.

NTA president Wee Boon Kim said drivers are expected to make about $6 or $7 more under the new fare structure.

Other firms say they have not decided whether to revise their fares, and will make a decision after seeking feedback from their drivers.

The report added that SMRT Taxis will consider a fare revision as drivers' operating costs have increased since the last fare revision in 2007.

ComfortDelGro explained the reason behind the revision by pointing to how "strong population growth and an increase in tourist arrivals" have led to a significant increase in demand for taxis throughout the day -- even during "off-peak" hours, The Straits Times said.

From Asiaone, "Association urges other taxi operators to follow fare revision".

ComfortDelGro is making a mixed bag of changes to its taxi fare structure that will kick in from 6am next Monday, and other taxi companies may soon follow suit.

While the peak period surcharge will be 10 percentage points lower at 25 per cent of the metered fare, passengers will be hit by the surcharge an hour earlier in the morning on weekdays, starting from 6am. At night, while the peak period will start an hour later at 6pm, it will end only at midnight, instead of at 8pm.

On top of that, Sundays and public holidays, previously free of peak period surcharges, will have the evening peak period surcharge kick in, also from 6pm to midnight.

'Weekends and public holidays, which used to be 'quieter', have also seen a sizeable jump in demand for taxi services in recent years,' ComfortDelGro said in a statement yesterday.

The largest taxi operator in Singapore, its taxi companies Comfort Transportation and CityCab together manage a fleet of 15,700 cabs, which represents 66 per cent of the estimated 23,800 total taxi strength in Singapore.

Its competitor, SMRT Taxis, 'will be considering a fare revision as well, as operating costs for our drivers have gone up since the last fare revision in 2007', Tony Heng, its deputy director, told BT.

The last time ComfortDelGro tinkered with its fare structure in 2007, fares went up between 10 and 49 per cent. Soon after that, other taxi operators raised their fares as well, their own fare structures revamped to resemble ComfortDelGro's.

This time around, based on calculations by ComfortDelGro, a commuter who takes a taxi between 5pm and 6pm will see a 21 per cent - or $2.60 - reduction in taxi fare for a 10-kilometre trip. Someone taking a taxi during the extended peak hours, however, will see an increase of 33 per cent - or $3.00 - for the same trip.

The $3 city area surcharge will also extend to Sundays and public holidays, from 5pm to midnight, under the new fee structure. The $1 public holiday surcharge that is currently levied, however, will be done away with.

Passengers will feel the pinch from the time they hail the cab, with flagdown rates 20 cents higher for the first km. For limousines, the flagdown rate will go up 70 cents, to $3.90.

Once in the cab, distance fares will be two cents higher, but 'the meter will move slower', ComfortDelGro said.

Currently, it subsequently costs 20 cents for every 385 metres up to a distance of 10km. Under the new structure, it will cost 22 cents every 400m. Beyond 10km, the rates will go from 20 cents for every 330m to 22 cents for every 350m. On a per-metre basis, it will cost more.

For every 45 seconds of waiting time, passengers will pay 22 cents - an increase of two cents.

'Like most Singaporeans, our drivers too look forward to annual improvements in their take-home income so as to provide a better life for their families. Unfortunately, most of our drivers' income has remained flat over the last two years due to rising costs. This adjustment is therefore timely and fair to help our drivers improve their earnings,' said Wee Boon Kim, president of the Comfort Taxi Operators' Association.

On the upside, current booking fees will be reduced by 20 cents to $3.30 during peak periods and $2.30 during non-peak hours.

The advance booking fee, however, will leap from $5.20 to $8 to 'encourage more drivers to accept such bookings', ComfortDelGro said.

From Business Times, "ComfortDelGro revises taxi fare structure".